Car Insurance Claim Settlement: Learn How To Negotiate It?

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Written by PolicyBazaar

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Updated 16 November 2016

Negotiating for a fair settlement to receive the deserved payout is a critical step, if you have filed an insurance claim settlement for a car accident, a personal injury claim, or both. It is also imperative to know the terms, conditions, and declarations of your policy to assess and how car insurance settlements work, because a claim cannot be made unless the policy covers the damages.

This is not where it ends. Negotiating a car accident insurance settlement claim involves a lot more, and these tips can assist you in securing a favorable settlement by providing a better understanding of car insurance settlement process.

Tips to Negotiate Car Insurance Settlement Claim

1. Initiate the Car Insurance Claim As Soon As Possible

After a car accident, the insurance company should be contacted immediately and a claim should be initiated at the earliest, so the smallest details can be recalled accurately, while any property damage and/or injuries can also be reported.

2. Maintain Detailed Records

Besides knowing what your car insurance claim is worth, it is also vital to maintain a file with all records of the car accident, arranged in chronological order. The file should have doctors’ visit records, medical bills, car repair bills, a police report if there is one, and all other relevant bills/receipts related to the accident. These documents are the cornerstone of the car insurance settlement process and help expedite the process.

3. Work Out an Insurance Claim Settlement Amount

While putting together the demand letter, you should be able to evaluate and decide on a minimum acceptable, fair insurance claim settlement amount within that range.

It is good to keep your bottom line in mind while negotiating, however, it is also necessary to be slightly flexible about the figure that you have decided. If the claims adjuster indicates certain facts you skipped considering, but which could make your claim weaker, your decided figure may have to be lowered to some extent. Should the adjuster begin with an offer close to your minimum, you may want to consider revising your figure upward.

4. Send a Detailed Demand Letter

In the demand letter to your insurance company, justify the figure you have arrived at, supported by the following details:

Description of the car accident and the resultant injuries suffered.

Medical treatment received, and all related treatment/medicine costs.

Loss in regular income caused due to the accident/injuries.

Suffering endured after the accident.

Cost of vehicle repair/replacement and any other property damaged due to the accident.

If you require long term medical care.

If you are permanently disabled.

To keep a buffer, you could ask between 25-100% higher than the amount you would be willing to settle for.

The letter should be backed by all the necessary documentation and evidences. Remember, lack of evidences may dampen all your efforts.

5. Highlight Your Strongest Points

In the negotiations, emphasize the strongest points in your favor. For instance, that the other party was at fault, that you had a traumatic injury, the exact nature of the injuries you suffered, that your medical costs were very high, etc.

You may also put forth the emotional perspective to support your claim. If you have a photograph of a serious-looking injury or the smashed car, refer to it. If your injury is such that you will need lifelong medical care, mention how this impacts your finances, work, and quality of life. Although a price cannot be put on the emotional factors, if they are put forth correctly, they could be powerful enough to get the insurance company to settle the claim fairly.

6. The First Offer is Not the Last

The first offer made by the insurance adjuster is sometimes too low – this could be a possible tactic to judge if you know what your claim is actually worth. It is better not to immediately lower your demand letter amount. Judge how reasonable or unreasonable the offer made to you is. If the offer is too low, you may ask for a justification, make notes, and follow it up with a letter responding to each factor mentioned by the adjuster. However, if the offer is reasonable, you could make a counter offer slightly lower than your demand letter amount. This shows that you are being reasonable. With a little more bargaining, you should be able to get a final settlement that both parties consider fair.

7. Get the Settlement in Writing

Make notes of all communication of insurance claim settlement with the company and insist that all settlement offers are in writing. The letter must have the final amount for which you have settled, the damages or injuries covered in the settlement, the approximate date by which you can expect the settlement documents from the insurance company, etc. Once a mutual agreement is reached, ensure that a signed and dated hard copy of the agreement with all the necessary details is in place.

8. Know When to Seek Legal Advice

In the event that you are unable to arrive at a fair settlement agreement after negotiations with the insurance company, you may need to hire a car accident lawyer. An experienced lawyer can help you correctly evaluate your situation, expedite negotiations, and write a final settlement letter to push the company to work more diligently on your claim. A lawyer is also the best judge of when to end the negotiations and file a lawsuit if need be.

9. Rigorous Follow-Ups

Claim adjusters handle hundreds of claims; hence it is not advisable to wait for your insurance claim settlement to come through. Stay in regular touch with your adjuster and keep following up – this will ensure that your file moves up to the top of the pile.

Irrespective of whether you are hiring a lawyer or not, the above tips will assist you in negotiating a fair deal in case your car meets with an accident.

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